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Private Label Beauty Brands: an Executive Briefing

Private Label Beauty Brands: an Executive Briefing for EurostafA complete Report written for Eurostaf:
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Why are private label brands a major issue today?
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What are the different strategies led by retailers and the different business models?
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14 février 2015

In the Beginning, the Category (Brand Dynamics 1/6)

This post is the first of a series of 6, introducing my vision of Brand Dynamics and Brand Typology. This post being quite long is spread over two pages!

When a consumer walks down a supermarket aisle, when a buyer looks up a professional directory they both have in mind – first and foremost – a category: “I must buy a bottle of Champagne for our marriage anniversary” / “I must find a reliable source of silicones”. They mostly do NOT have a brand in mind. It is only at a later stage that they will come to grips with “Do I favor Moët or Veuve?” or “Do I go for Dow Corning or Xiameter?”. All consumers think in categories.

If we want to understand how brands relate to categories we need to explore two different routes. We first must understand how consumers think of categories and then we must understand the categories in which brands are rooted.

1. Consumers have a clear representation of each category: introducing Category Meaning SystemsGetting to understand how consumers think of categories is a fascinating process. In the course of my professional life I have studied many categories with colleagues in psychology and sociology. Every such study reveals understandings that are a boon for a brand manager. They show that one should start by identifying the category’s meaning system, before any sort of study of a brand. Let us have a look at two such cases – and what implications such studies have for business (NB: only one is analyzed here today).

The laundry care/fabric conditioner case:Consumer panels can be misleading: when asked what is the most important thing in a fabric conditioner consumers answer “fragrance”. Brands will then focus on developing new fragrances and be often surprised at how poorly they perform. Why? Because they have not made an in-depth representational analysis of the category. Here is what it could be.What is laundry? Laundry is double-faced: it is both part of our social life (the clothes we wear and how we are perceived by others) and intimate (my vision of myself, the clothes that I wear on my skin every day). It therefore is a category with high consumer involvement – where category meaning is technical (product characteristics), functional (product performance) and emotional. Who takes care of laundry? Women (in the collective mindset). Laundry has always been associated with the work women do at home – taking care of their family’s well being. What is a fabric conditioner? A product added in the washing machine that is supposed to “help your laundry feel and smell fantastic” (as Unilever says on their Comfort website). What do these products bring to the consumer? Mostly emotional benefits: fragrance (fragrance is linked to smell – which is fundamentally emotional), freshness, and softness.The woman who takes care of the laundry is not only performing a technical/functional task (washing clothes): she also shows she cares for her family. She is both the perfect housewife and the caring mother. Therefore using a fabric conditioner is an act of love.Unilever in its permanent fight with P&G decided to enter in 1969 the laundry care category with a brand named Comfort – successful in the UK but with little success in certain European countries (like Germany or France). Of course the word Comfort tells us of functional benefits – how comfortable one will be in a shirt – and it has some emotional benefits. But the name is not the only sign that impacts the consumer. Visual signs are often more meaningful. The logo is one of these visual signs. The Comfort logo is fascinating: it is different from country to country. Let us put side by side the China (& India) logo with the UK logo:

The difference is slight but quite revealing: in the UK logo a heart has been introduced since 1992. The UK logo is about love – expressed discreetly.Now what happened in Germany and France is enlightening. Faced with the poor performance of the Comfort brand the German subsidiary developed a completely different brand named “Kuschelweich” (meaning ‘Soft/Cuddly’) and adopted as mascot (another of the visual signs conveying brand meaning) a teddy bear – with huge success. Everyone saw in it a symbol of softness but my analysis is different: the teddy bear is the perfect example of the ‘transitional object’ or ‘comfort object’ as introduced by Donald Winnicott. A transitional object is a physical object that takes the place of the mother-child bond. Infants see themselves and their mother as a whole so that when the young child separates to gain independence from his mother it needs objects that embody that lost link. It is the first object that really belongs to the child. All mothers know that the child’s teddy bear must NOT be washed. The loving care of a mother for her children is therefore embodied into the teddy bear: the choice of the teddy bear was a brilliant marketing decision.In France the brand is launched under the name Cajoline – with the same teddy bear and in the USA Comfort is transformed into Snuggle in 1983 – with a subsequent tripling of their market share.

2. All brands originate in a category

All brands originate in a specific category – what we shall call here their Founding Category: Tom’s is shoes, Warby Parker is glasses, Hermès is leather, Dove is body care, Clinique is skincare, Nespresso and Starbucks are coffee. Of course most brands will, with time, extend their offer into other categories (what marketers call brand extension): Tom’s is now in glasses also, Hermès is in 8 different categories (their “métiers”), Dove has extended into skincare, Clinique into perfume, Starbucks has dropped the ‘Coffee’ of its logo to move to tea, drinks and food.

We will be analyzing these moves but one must never forget where the brand comes from because in the consumer’s mind this is the predominant category of the brand, which confers legitimacy to it. For instance let us look at how Hermès reminds us of its Founding Category leather by having a look at their website. Once again the same question arises: how can I convey meaning by using visual cues (or signs)? A website can of course use words but this meaning must be self-evident at first glance. Hermès has had a brilliant idea: use the core know-how of leatherwork which is stitching as the sign separating areas on their e-commerce website as seen below.

The importance of the founding category is quite noticeable in luxury brands: when consumers buy a Dior skincare product or a Ralph Lauren perfume they think “fashion”, when they buy a Cartier pen or handbag they think “jewelry”. Similarly when they enter a Mr. Clean car wash they will think of “home cleaning”. And whatever the future of Starbucks it will remain rooted in “coffee” for years in their customers’ mind. My contention here is that all brands are rooted in their Founding Category and that the brand dynamics is both to build on this category’s meaning system AND to escape it. As we move along we will see, using numerous brand cases, how brands solve this apparent dilemma.

Major points to remember

The history of a brand is closely linked to its Founding category

Each category’s meaning system should be analyzed and understood – to ensure success

Consumer choices are guided both by their perception of the category to which a product belongs and their perception of the brand

Commentaires

This post is the first of a series of 6, introducing my vision of Brand Dynamics and Brand Typology. This post being quite long is spread over two pages!

When a consumer walks down a supermarket aisle, when a buyer looks up a professional directory they both have in mind – first and foremost – a category: “I must buy a bottle of Champagne for our marriage anniversary” / “I must find a reliable source of silicones”. They mostly do NOT have a brand in mind. It is only at a later stage that they will come to grips with “Do I favor Moët or Veuve?” or “Do I go for Dow Corning or Xiameter?”. All consumers think in categories.

If we want to understand how brands relate to categories we need to explore two different routes. We first must understand how consumers think of categories and then we must understand the categories in which brands are rooted.

1. Consumers have a clear representation of each category: introducing Category Meaning SystemsGetting to understand how consumers think of categories is a fascinating process. In the course of my professional life I have studied many categories with colleagues in psychology and sociology. Every such study reveals understandings that are a boon for a brand manager. They show that one should start by identifying the category’s meaning system, before any sort of study of a brand. Let us have a look at two such cases – and what implications such studies have for business (NB: only one is analyzed here today).

The laundry care/fabric conditioner case:Consumer panels can be misleading: when asked what is the most important thing in a fabric conditioner consumers answer “fragrance”. Brands will then focus on developing new fragrances and be often surprised at how poorly they perform. Why? Because they have not made an in-depth representational analysis of the category. Here is what it could be.What is laundry? Laundry is double-faced: it is both part of our social life (the clothes we wear and how we are perceived by others) and intimate (my vision of myself, the clothes that I wear on my skin every day). It therefore is a category with high consumer involvement – where category meaning is technical (product characteristics), functional (product performance) and emotional. Who takes care of laundry? Women (in the collective mindset). Laundry has always been associated with the work women do at home – taking care of their family’s well being. What is a fabric conditioner? A product added in the washing machine that is supposed to “help your laundry feel and smell fantastic” (as Unilever says on their Comfort website). What do these products bring to the consumer? Mostly emotional benefits: fragrance (fragrance is linked to smell – which is fundamentally emotional), freshness, and softness.The woman who takes care of the laundry is not only performing a technical/functional task (washing clothes): she also shows she cares for her family. She is both the perfect housewife and the caring mother. Therefore using a fabric conditioner is an act of love.Unilever in its permanent fight with P&G decided to enter in 1969 the laundry care category with a brand named Comfort – successful in the UK but with little success in certain European countries (like Germany or France). Of course the word Comfort tells us of functional benefits – how comfortable one will be in a shirt – and it has some emotional benefits. But the name is not the only sign that impacts the consumer. Visual signs are often more meaningful. The logo is one of these visual signs. The Comfort logo is fascinating: it is different from country to country. Let us put side by side the China (& India) logo with the UK logo:

The difference is slight but quite revealing: in the UK logo a heart has been introduced since 1992. The UK logo is about love – expressed discreetly.Now what happened in Germany and France is enlightening. Faced with the poor performance of the Comfort brand the German subsidiary developed a completely different brand named “Kuschelweich” (meaning ‘Soft/Cuddly’) and adopted as mascot (another of the visual signs conveying brand meaning) a teddy bear – with huge success. Everyone saw in it a symbol of softness but my analysis is different: the teddy bear is the perfect example of the ‘transitional object’ or ‘comfort object’ as introduced by Donald Winnicott. A transitional object is a physical object that takes the place of the mother-child bond. Infants see themselves and their mother as a whole so that when the young child separates to gain independence from his mother it needs objects that embody that lost link. It is the first object that really belongs to the child. All mothers know that the child’s teddy bear must NOT be washed. The loving care of a mother for her children is therefore embodied into the teddy bear: the choice of the teddy bear was a brilliant marketing decision.In France the brand is launched under the name Cajoline – with the same teddy bear and in the USA Comfort is transformed into Snuggle in 1983 – with a subsequent tripling of their market share.